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Sustainable Leaders “Need to Go From Good to Great”

The creation of a business culture committed to sustainability will depend on high quality leadership. Every year, Edie holds a conference in the UK to focus on sustainable business leadership – to look ahead to the emerging agenda, and to identify the current state of best practice. This year, the focus was very much influenced by the rising profile of climate change and the profound implications for how businesses create wealth. Mallen Baker is the host of the Mallen Baker Podcast (please refer to the link at the end), a podcast aimed at change makers. Since its launch last year, he has interviewed a number of the leading figures who were brought together at this conference. Environmentalist Jonathon Porritt, head of sustainability for Marks & Spencer Mike Barry, and conference chair Solitaire Townsend.Here he reviews the central messages that they, and other speakers, gave to the conference.

At the Edie Sustainable Leaders Conference in the UK, the tone for the event was set by a stark warning by long-time environmentalist Jonathon Porritt, who said that what counts as leadership today won’t count as leadership tomorrow. In other words, we need to be bolder, and to move faster.

He adopted a frankly apocalyptic tone as he drew attention to recent forecasts by oil giants BP and Shell predicting that the fossil fuel contribution to the global energy mix would be identical in 2050 to today – a statement that flies in the face of everything we understand about the science of what we need to do in the coming decades.

Not one business leader, he noted, criticised the companies’ projections.But it was perhaps an honest reflection of the fact that, although we see individual examples of leadership and change, the macro economy is still firmly wedded to what he described as “a linear mindset”. In other words, it runs on a model based on ‘extract, make, use, throw away’ rather than a circular one that eliminates waste.

Individual examples of good practice won’t matter, he concluded, unless we can reshape the macro economy. Not only do we need to end the silence about the climate emergency we find ourselves in, but also it is time to stop being sympathetic with companies that “pay wretched wages to their poorest employees on the grounds of competitiveness”.

It was a sobering start to the event, and although most agreed with the principles, not everybody agreed with the tone. Conference facilitator Solitaire Townsend, co-founder of the change consultancy Futerra, respectfully disagreed with Jonathon Porritt’s pessimism. She argued instead that positivity in campaigning is needed to give people motivation and hope for change, and that there is plenty to be optimistic about in the progress that is being made.

Conference organiser Edie provided some data on the subject by launching its latest annual survey of sustainable business leaders. It confirmed that sustainability professionals in the UK had struggled to keep focus with the national issue of the moment, the UK’s looming exit from the European Union, inevitably becoming a major area of focus. Companies had, however, put a lot of work into another major issue of public concern, that of single-use plastics and the accumulation of plastic waste in the environment. Some had identified that the benefit of focusing on a very specific issue was that you could move quite quickly on it. However, it could also have significant unintended consequences.

For instance, food retailers often pointed out that there was an inverse relationship to the amount of plastic packaging used and the amount of food waste that was generated. So it’s important to tackle problems in a more holistic way with an eye to some of the inevitable trade-offs that are involved, rather than simply jumping onto a single-issue bandwagon.The survey apparently concurred with Jonathon Porritt’s bleak view in one regard – the majority saw the struggle with short-term business models as being the principal challenge for 2019, along with the struggle to influence the behaviour of consumers to be willing to consume in a more sustainable way.

Companies are actively experimenting with the latter. For instance, it was noted at the conference that retail giant IKEA is to introduce a system whereby people can lease furniture rather than buying it. This is the latest example of a company trying to create an economic model that rewards more resource efficient behaviours with greater profits.

Whether customers are ready to embrace it or not is the big question, however.

Improvements in energy efficiency and innovation are the areas where people expect to make the most gains in 2019, along with waste reduction. These areas are often described as “making the existing business model less bad”.

When asked what would be most important to future business leadership, the top answer was to align businesses with business values and purpose. The next answer was to drive action to scale through collaboration. Both imply a shift from this ‘business-as-usual’ approach.

Mike Barry, the highly-respected head of sustainability for UK retailer Marks & Spencer, echoed the sentiment with his presentation towards the end of the conference. He said that all of the sustainability professionals in the room were good, but that wouldn’t be enough to help their businesses make the changes that would be needed. They needed to be great.

He said there were five steps to make the transition from good to great.

One – Engage with the entire workforce in the business, not to become isolated within an individual corporate responsibility team. Sustainability had to be something that was seen as the business of everybody, marketers, product designers, sales teams, procurement teams – everybody.

Two – Make sustainable consumption desirable. There is a modest percentage of people who behave like ‘green consumers’. A lot more would be willing to buy more sustainably, but need to have options put in front of them to make it easy. And that means that sustainable features have to be seen as useful and desirable to ordinary people.

Three – Localise the big issues. Make the company’s commitments real to specific places with very real and immediate problems. The big issues will only have meaning to people if they can see how they affect their immediate surroundings and their lives.

Four – Use collaborations, even with competitors, to achieve wider changes to business norms, rather than simply aiming to be the best as individual businesses.

Five – Use the potential of innovation and technology. Drive what is often referred to as ‘the fourth industrial revolution’ in areas such as artificial intelligence, driverless electric vehicles, robotics and 3D printing.

Other panels during the conference confirmed that they had made solid progress in raising the ambition within the business by gaining buy-in to the need to adopt “science-based targets”.

There are now well-established objectives for society in restricting greenhouse gas emissions to enable us to remain under, preferably 1.5ºC of warming. Therefore any business could look at their current rate of emissions and seek to establish what they would need to do to meet the ambition of that goal. Since it is hard to argue that one shouldn’t aim to meet what the best science tells us we need to do, it had been an immensely powerful lever with business leadership to get them to face up to the size of the challenge.

Gabrielle Giner, head of environmental sustainability for telecoms company BT, said that in previous years they had gone to the Board to argue for something like 20% reductions, and the Board members would know this was a figure that had been arbitrarily made up. But now they went with a figure of 87% because that was the science-based target they needed to achieve.

It was a suitable illustration of how, in some of the leading companies, the scale of ambition is being significantly raised in the face of the best science and evidence of how we need to create wealth as a society.

However, hanging in the air were Jonathon Porritt’s opening words. Individual examples of excellence will not be enough. We will need to change the wider business culture to fit in with the same principles.

And that is the scale of the challenge for sustainable business leadership in the next decade.

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